WASHINGTON, (NASA) - NASA announced Thursday it will conduct a new competition for funding that remains in NASA's Commercial Orbital Transportation Services Project, known as COTS.

The new competition follows NASA's decision to terminate its funded agreement with aerospace firm Rocketplane Kistler of Oklahoma City, which repeatedly failed to meet agreed-upon milestones in its effort to develop and demonstrate commercial transportation capabilities to low Earth orbit. NASA informed Rocketplane Kistler Thursday of its decision in a letter signed by Associate Administrator for Exploration Systems Rick Gilbrech.

"NASA remains fully committed to the COTS Project," said Alan Lindenmoyer, who as manager of the Commercial Crew and Cargo Program Office oversees the COTS Project.

"We'll be releasing a synopsis for the new competition Friday and the full announcement for a new round of industry proposals on Monday."

Companies will have 30 days to respond to Monday's announcement, and NASA intends to enter into one or more new COTS agreements early next year. Companies that are U.S. commercial providers, as defined in the Commercial Space Act, will be eligible.

COTS provides seed money to companies when they reach performance milestones to help them design and develop space transportation capabilities that could pave the way for private cargo deliveries to the International Space Station. Of the $206.8 million NASA agreed to invest in Rocketplane Kistler, the company received a total of $32.1 million. The remaining $174.7 million will be offered to aerospace firms in a new competition.

"A vibrant commercial space industry will help NASA fulfill its promise to support the International Space Station, retire the space shuttle and return humans to the moon," Lindenmoyer said.

In 2006, NASA chose two companies to receive COTS funding: Rocketplane Kistler and Space Exploration Technologies Corp., or SpaceX, of El Segundo, Calif. Both companies signed Space Act Agreements with the agency that detailed mutually agreed-upon financial and technical milestones, as well as a payment schedule based on those requirements.

In late May, Rocketplane Kistler missed the fourth milestone, a second round of private financing, in its COTS agreement. After months of discussions with the company, NASA officially notified Rocketplane Kistler in early September of its failure to perform. The agency decided to terminate the Rocketplane Kistler agreement when, after careful consideration, NASA concluded that further efforts were not in the agency's best interest. NASA followed the process for termination that was spelled out in the Space Act Agreement.

NASA's other funded COTS partner, SpaceX, is current on all of its financial and technical milestones. NASA also has unfunded COTS agreements with five other companies.

But I fear that this new contract will be more an alibi for NASA. When they run now a new competition for the money, a new company won't be selected before sometime in 2008.

As COTS runs only until 2010 this selected company would have at best 2 years to develop the necessary craft.

I would definitely give money to SpaceDev. They have shown that they can produce space hardware that actually has flown into space! I'm sure there is some contract legal issues that prevent NASA from simply giving the money to someone else right away. Two years is really not enough time. Why is there a time limit anyway? Does it have to do with the mission timetable for the ISS to go fully operational?

I think the "End of Shuttle"/ISS resupply matter was the basic idea behind it (although it seems that NASA accepted that there won't be an US resupply craft by buying Russian Progress freighters). I think changing that date would need a new funding from the Congress.

About Spacedev: I'm not so confident about their financial situation. A month ago or so the German OHB System Group (a German aerospace company) invested in Spacedev, which I think is normally a sign that Spacedev needed money?

_________________"The hardest hurdle to space isn't the technicalities and money. But rather, the courage and the will to do it." - Burt Rutan.

I think that the money would be better spent with a different company to get alternative vehicles built and my preference would be for SpaceDev also.

I dont see why NASA should stick to the original time scale for a new contract, if there is a 5 year gap in ISS supply having a commercial delivery system for any part of the gap would be an advantage and would provide competition to SpaceX after a couple of years.

Perhaps NASA will spread the money across a number of companies to push a range of vehicles along that would be fielded later than 2010 using either new NASA COTS awards or private funding which would be easier to obtain from investors if more progress could be demonstrated.

_________________A journey of a thousand miles begins with a single step.

I think the "End of Shuttle"/ISS resupply matter was the basic idea behind it (although it seems that NASA accepted that there won't be an US resupply craft by buying Russian Progress freighters). I think changing that date would need a new funding from the Congress.

About Spacedev: I'm not so confident about their financial situation. A month ago or so the German OHB System Group (a German aerospace company) invested in Spacedev, which I think is normally a sign that Spacedev needed money?

All space companies need more money. Isn't it a good sign that some other company wants to invest in SpaceDev? Why would the German OHB System Group invest in SpaceDev if they didn't feel that there is financial gain to be made?

@Mr. Hill: I think NASA has to stick to the original timeframe here because the Congress gave this money for a certain funding "project". I would assume that conditions of such budgets can't be changed by law.

NASA would have to give that money back to the Congress I guess and ask for a new funding for COTS contract "B". But as I'm not an US citizen I don't know exactly. Perhaps someone can put some light into this?

_________________"The hardest hurdle to space isn't the technicalities and money. But rather, the courage and the will to do it." - Burt Rutan.

Regarding not picking one of the other original finalists a good reason would be that they may have proceeding despite not having got the COTS-money. The ranking may have changed for this reason which should be found it - it improves the chance that NASA selects the team that is farthest in the project.

Regarding the timeframe ALL the teams may have been going on to develop, design, construct und funding. Think of the progress of Air Launch LLC's/t/Space's QuickReach for example and Scaled Composutes'/t/Space's newly achieved access to Northrop Grumman's Facilities for example.

I don't think that Scaled has access to any Northrop facilities and I think they even don't need that. Besides that I think that Scaled has a lot to do to get their SS2 working. I have the impression that they overstrained a bit, underestimating the step from making X-crafts to operational vehicles.

_________________"The hardest hurdle to space isn't the technicalities and money. But rather, the courage and the will to do it." - Burt Rutan.

Maybe NASA will miigate some of the risk by selecting a team that has a mixture of old and new space companies. The Dream Chaser/Atlas configuration proposed by SpaceDev would be a good example of this and would probably be ready quicker since a launche would not need to be designed from scratch but I agree it will be incredibly difficult for a new team to fly a demo flight in the time allowed.

One point to talk about is that SpaceX might compete again. This I consider to be bad. They already have won a contract and seem(ed) to consider it to be sufficient. The original COTS-sum explicitly was intended to be split between two companies. In my eyes NASA should exclude SpaceX from the new competition since tehy already got money and were content with the sum. ...

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Hello, Klaus,

there are a few facts indicating that the WK2/SS2-project might no obstacle to work on the CXV in parallel for Scaled Composites.

They worked on the CXV already which was demonstrated by a drop-test using a DTA dropped from a Proteus.

t/Space was a finalist of COTS - and Scaled is a member of t/space. If t/Space would have been awarded a COTS-contract Scaled would have to work the more on it. They simply would have to work on two projects and might hire more employees. t/Space may be willing to compete again now.

According to Burt Rutan/Scaled Composites the team working on WK2/SS2 consisted of 20 to 30 people only.

Scaled have hired more employees since 4th of October 2004.

In so far no problems of capacity etc. are to be expected.

The facilities of Northrop Grumman really may of significant meaning because they may reduce the required NASA-funds. This would mean that t/Space today don't need $ 400 mio no more but significantly less because Scaled could get parts produced by Northrop Grumman at a trust-internal price belwo the market-price. They also could apply Know How available at Grumman now which would reduce the development costs. And so on.

This doesn't have to do with needing something like hat but only with using opportunities to reduce the required amount of funds - it's Enterprise Economics simply and a strategy to win the money RpK doesn't get now.

I agree NASA should award any leftover COTS money from RpK to other team(s) and stick with the original SpaceX agreement, if SpaceX want additional money to do a crew demo flight that should be new funding.

As for Scaled helping with CXV or possibly a different team I think they have already stretched themselves with Virgin Galactic and the spacecraft company which is a joint venture. Their SS2 project has already been delayed and they will not want to take on any more work for a while.

Employing additional staff of the standard necessary in the numbers required would not be so easy and Scaled will not wish to expand at a rate that means it will loose some of the work practices and thinking that has made it successful. A large number of new people is likely to have an impact on the company's dynamics.

Quote:

This would mean that t/Space today don't need $ 400 mio no more but significantly less because Scaled could get parts produced by Northrop Grumman at a trust-internal price belwo the market-price. They also could apply Know How available at Grumman now which would reduce the development costs. And so on.

A couple of points here

i) the cost of parts produced internally will be cheaper than buying them from Northrop, if this were not the case then why do teams nearly always produce their own?
ii) how can you argue that Northrop has know how to reduce development costs when so many threads always point out that the "old space companies" produce things more expensively?
iii) you are assuming that most of the $400m cost would be incurred by Scaled in the first place. This may not be the case as the booster (derived from Quickreach 2) may form a large part of the costs so any savings that Scaled could make as a result of being involved with Northrop would have a smaller impact on the project.

_________________A journey of a thousand miles begins with a single step.

the first point you are mentioning has to do with a particular distiction required. "cheaper" doesn't have to do with costs in this case but with the price.

Trusts like Northrop Grumman not only sell their prodtcs at the markets but also apply, use or consume them within the trust. Since the trust consists of several companies independent by law but dependent by economics to use etc. something internally is differenet to selling it at the market. It still is required to sell something at any price because of balances and so on - but the price is fixed and no way effected by or adjusted to the market. This price is below the market price to enable the companies that are part of the trust to achieve interesting profits.

This means that Scaled had to pay more for a product from or a service by Northrop Grumman when they were owned by them by 40% only than now at being owned by 100%.

This also menas that getting something from Northrop is like producing it internally. They don't need to invest into additional machines etc. which saves depreciations. If they don't use possible access to Northrop's equipment they still would have to invest and depreciate. This reduces costs.

Regarding Know How I was talking about knowledges, experiences and capabilities Scaled don't have yet. There also is another important distinction - economically development costs don't have much to do with production costs or market prices. This might require a bit more talking about economics - please ask if this statement turns out to be puzzling.

Because of the informations from Air Launch LLC and my approaches in the CXV-thread of the Financial Barriers section it's looking to me as if the major portion of the $ 400 mio development costs of the CXV will be caused by the CXV and the VLA whereby the VLA might be the WK2 perhaps (depends on the payload capacity of the VLA).

I would say that looking at what other partners are contributing Airlaunch would be the major player. But all this is irrelevant as I believe that Scaled have Virgin Galactic to concentrate on.

I dont want to get into a discussion about how much cheaper CXV could be now that Scaled are owned by Northrop as I think that should be discussed in the financial barriers section and with my knowledge of finance I would be arguing from a point of ignorance.

SpaceDev has quoted something like $100m in the past to produce an orbital Dream chaser and while this may be more when used in conjunction with Atlas V it is still going to much less than the CXV and be quicker to build.

_________________A journey of a thousand miles begins with a single step.